Research & Policy Briefs From the World Bank Malaysia Hub No. 29 April 8, 2020 How Two Tests Can Help Contain COVID-19 and Revive the Economy Damien de Walque, Jed Friedman, Roberta Gatti, and Aaditya Mattoo Faced with COVID-19, countries are taking drastic action based on little information. Two tests can help governments shorten and soften economically costly suppression measures while still containing the novel coronavirus (COVID-19) pandemic. The first—a PCR assay—identifies people currently infected by testing for the presence of live virus in the subject. The second—an antibody test—identifies those rendered immune after being infected by searching for COVID-19-specific antibodies. The first test can help contain the disease because it facilitates the identification of infected persons, the tracing of their contacts, and isolation in the very early stages of an epidemic—or after a period of suppression, in case of a resurgent epidemic. The second can help us assess the extent of immunity in the general population or subgroups, to finetune social isolation and to manage health care resources. Wide application of the two tests could transform the battle against COVID-19, but implementing either on a large scale in developing countries presents challenges. The first test is generally available, but needs to be processed in adequately equipped laboratories with trained staff. The second test is easy to perform and can be processed quickly on the spot, but at this stage it is produced and available only on a limited basis in a few countries. This policy brief reviews the use of both tests, suggests strategies to target their use, and discusses the benefits and costs of such strategies. If PCR assay testing, together with tracing and isolation, helps reduce the duration of suppression measures by two weeks, and antibody testing allows one-fifth of the immune return to work early, the gain could be about 2 percent of national income, or about $8 billion for a country like the Philippines. Because the estimated economic benefits of the tests are likely to far outweigh the cost, the international community must help countries develop the capacity to process the first test and procure the second. “The social returns to gathering…information and acting upon it is high: it reduces both the death toll and the size of the economic contraction.” —Eichenbaum, Rebelo, and Trabant (2020) On March 16, 2020, the Philippines imposed a lockdown on the 53 function. It currently takes a few hours to get results once the sample million people in Luzon, the country’s economic and political center has reached the laboratory, but faster kits are under development. and home to half of its population. This "enhanced community The PCR assay is accurate when conducted carefully by trained quarantine" followed similar restrictions on the movement of people technicians in a well-equipped laboratory. Other options—such as an in many other countries struggling to flatten the COVID-19 infection antigen quick test or a mobile PCR platform—can be done at point of curve. These countries have no choice: the spread of the disease care, but they have only recently been developed and are not as threatens to overwhelm their capacity to treat. sensitive or as precise as a PCR assay. These alternatives may improve rapidly, however, in which case mass decentralized antigen testing or But an impasse is imminent. Stringent controls, if in place for long, PCR assays would be possible. will lead to unacceptable economic distress. However, lifting the controls risks unleashing the pandemic. Governments across the 2. Antibody test. This type of test helps identify immunity to the world will have to choose between the risk to life from economic disease by spotting signs of an immune response, indicating that deprivation and the risk to life from increased disease someone has been infected by the coronavirus in the past. It is not yet transmission—unless there is a way of controlling the disease without clear how long the immunity detected by the antibody tests will last stifling economic activity. and how quickly new mutations of the virus are likely to emerge. Various types of antibody tests are now in use and under Fortunately, there may be. In the aftermath of the 2003 SARS and development. The test is performed by collecting a blood sample 2015 MERS epidemics, the Republic of Korea and Singapore invested through a finger prick. Processing the test does not require a in the capacity to test, track, and selectively socially isolate, and were laboratory and relies only on a rapid test kit, with results available on therefore able to contain the pandemic without undue economic the spot in a few minutes. Various antibody tests are reportedly being pain. If countries like the Philippines—which we use as an example in used in Singapore and the United Kingdom, and have just been this note—could build at least some similar capacity to test soon, they approved by the US Food and Drug Administration. may begin to consider an eventual phase-out of restrictions without fear of the disease escalating or recurring (World Bank 2020a). But How and When Can the Two Tests Help? can they build sufficient testing capacity in time and at an acceptable cost? The two tests can serve as complements to each other. Figure 1 shows the proportions of the population infected and recovered over What Tests Are Available for COVID-19? time and indicates at what points in the disease progression the various testing strategies are most useful. There are two types of test (World Bank 2020b). Each has different functions. The PCR assay can be deployed, in combination with tracing and selective isolation of positive cases, as an alternative to stringent 1. Polymerase chain reaction (PCR) assay. The first type of test helps suppression when the level of infection is sufficiently low, early at identify whether an individual is currently infected (and thus likely the beginning of the pandemic (to the left of the first vertical red currently infectious) by detecting the presence in the body of the new line in figure 1) (as was done in Korea) and later when a suppression coronavirus, which causes the disease COVID-19. The PCR assay is well strategy has sufficiently lowered the level of infection (to the right of established. It is performed by collecting a swab well inside the nose the second red vertical line) (as might be done in China). The or back of the throat. The test needs to be processed in a laboratory thresholds depend on the national capacity to test, track, and with a PCR machine, but mobile units can reportedly perform the isolate (TTI). Affiliation: Damien de Walque, Jed Friedman, Development Research Group, World Bank; Roberta Gatti, Human Development Practice Group, World Bank; and Aaditya Mattoo, East Asia and Pacific Region, World Bank. E-mail addresses: ddewalque@worldbank.org, jfriedman@worldbank.org, rgatti@worldbank.org, amattoo@worldbank.org. Acknowledgement: We are grateful to Enis Baris, Gabriel Demombynes, Daniel Dulitzky, Achim Fock, Marelize Gorgens, Aart Kray, Norman Loayza, Robert Oelrichs, Olusoji Oyefo Adeyi, Martin Raiser, and David Wilson for helpful discussions. Nancy Morrison provided excellent editorial assistance. Objective and disclaimer: Research & Policy Briefs synthesize existing research and data to shed light on a useful and interesting question for policy debate. Research & Policy Briefs carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions are entirely those of the authors. They do not necessarily represent the views of the World Bank Group, its Executive Directors, or the governments they represent. How Two Tests Can Help Contain COVID-19 and Revive the Economy While the virus is spreading (shown in the space between the two safely return to tasks requiring close human interaction. The antibody red vertical lines), a containment strategy with strict suppression test would in practice serve as an “immunity certificate or passport,” measures can be deployed. The thresholds depend on the national allowing people to return to work and move around. Such testing capacity to test, track and isolate (TTI), not just in the main cities but could be one of the key tools to implement smart containment and also across the country. For example, Korea can carry out as many as mitigation strategies (Loayza 2020). 18,000 PCR assays per day, whereas the Philippines has only just succeeding in ramping up capacity to 1,000 PCR assays per day. There are, however, two concerns about the use of the antibody test. First, it could have unintended consequences. People could The PCR assay has been central to the testing, contact tracing, and choose to or be coerced into being infected so that they could get the targeted isolation efforts in China; Hong Kong SAR, China; Korea; “immunity certificate” sooner; or people, hopeful to return to work Singapore; and Taiwan, China. It may still be important for some but not yet infected, could seek counterfeit immunity certificates. developing countries like Lao People’s Democratic Republic, Moreover, social tensions could arise between those who have and Myanmar, Papua New Guinea, and the Pacific Island countries in those who do not have immunity certificates. The second concern is quickly identifying the infected and tracking those with whom they about the accuracy of the test. The sensitivity (avoiding false have directly or indirectly interacted. Therefore, their capacity to negatives) and the specificity (avoiding false positives) are important process PCR assays and to track and isolate should be ramped up as parameters of the test. A high specificity is crucial to avoid false soon as possible. These steps can also play an important role in positives, especially when the aim is to use the antibody test to containing an epidemic after a period of stringent suppression—a identify individuals who have developed immunity. The sensitivity and situation in which a country like China may currently be. specificity of tests tend to improve over time, but it will be important The antibody test could be useful in at least three respects. First, if to monitor test performance in developing country contexts. It is also the test were carried out on a representative sample of the population important to recognize that the accuracy standards required to glean in any country that has experienced significant community broad epidemiological information by testing a representative sample transmission, it would reveal the country’s level of acquired immunity may be lower than those in a test for individual diagnostic use. at that time. Combined with information on mortality and morbidity, The numerical example that follows illustrates how we could it could help us understand the epidemiological profile and devise calculate the critical proportion of population that has recovered, r*, appropriate testing strategies. For example, it is conceivable that the at which point the benefits of a population-wide antibody test would virus has already infected a large proportion of the population and we cover the costs. It also shows that the threshold may come earlier are closer to achieving the critical level of resistance known (re*) for subgroups, such as health workers, who in general provide a colloquially as herd immunity. This knowledge would be a global high social benefit. Immune health workers could be assigned public good and could mitigate a potential misallocation of the health exclusively to the care of suspected and confirmed COVID-19 cases. investments that all countries are in the process of making. This would have the double benefit of ensuring greater continuity of Second, stratified random sampling could reveal the patterns of care for both COVID-19 cases as well as patients with other immunity across population groups differing by region, age, gender, conditions, as health workers without immunity would have less and other salient characteristics. That would facilitate more targeted contact with the virus. In the figure, the break-even line for essential and phased social distancing policies based on risk profile. For workers is far to the left of the break-even line for the general example, in an island country like the Philippines, stronger population, indicating the high relative benefit of immunity testing for suppression measures could be implemented in some islands rather them. than others. Table 1 extends this discussion by presenting an assessment of the Finally, more granular implementation of the test could help net benefits of implementing the PCR assay and the antibody test at identify individuals who had developed immunity and could therefore three different levels of the population. Figure 1. When the PCR Assay and the Antibody Test are Most Useful Intermediate targeted Limit to PCR-based TTI anti-body testing Threshold for resumption of strategy as alternative to first to protect then allow exclusively PCR-based TTI suppression; depends on essential workers others to work strategy for post- TTI capacity suppression containment Proportion of population Exclusive PCR-based TTI: test, trace TTI strategy range and selective isolation Suppression strategy range Time Regular antibody testing of a representative sample, as well as morbidity and mortality monitoring, at the sub- national level to inform choice of strategy Note: The shape of the curve and the placement of the lines are stylized. Further, the figure does not show either the susceptible proportion of the population or the levels of infection that would have prevailed in the absence of any containment strategy. F depicts the proportion of the recovered population. r* = the recovered population proportion for which the benefits of a population-wide antibody test would just equal the costs of a population-wide antibody test; re* = lower threshold for proportion of subgroups, such as health workers; PCR = polymerase chain reaction; TTI = test, trace, and isolate. 2 Research & Policy Brief No.29 1. Testing of a representative sample of the population, obtained With “smart containment” (whereby social planners can identify by stratified random sampling who is susceptible/infected/recovered—which massive antibody testing could make possible), the decline in national income would be In countries in which community transmission has been 5.6 percentage points lower than otherwise, Eichenbaum, Rebelo, established, the greatest net benefit currently is from an antibody and Trabandt (2020) estimate. That suggests the gains could be test on a population representative sample. Such a test would substantial even with the levels of testing that may be feasible. For provide information about the percentage of population already example, even if only one-fifth of the immune could return to work, immune, which in turn would inform the optimal allocation of the gain could be about 1 percent of national income, or close to health care resources and containment decisions based on US$4bn for a country like the Philippines. geographical and demographic characteristics. The most significant benefit of the PCR assay is that it could The net benefit from a PCR assay on a representative sample is shorten the duration of stringent suppression measures by reducing low because reasonable estimates of incidence can be based on the risk of resurgence. Since the Eichenbaum, Rebelo, and Trabandt morbidity and mortality data, as well as information from the (2020) estimates suggest that the average decline in national income antibody test on a representative sample of the population. The over the first year is more than 22 percent with suppression sample size needed for the antibody test would be 2,000–10,000 measures, the reduction in the duration of such measures by just two households per country or region, depending on need for weeks could translate roughly into an increase in national income by 1 geographical precision and the presumed (ex ante) rate of percent. In the case of the Philippines, that would be nearly US$4 seropositivity (having blood serum that tests positive for COVID-19 billion. antibodies). This test would be most valuable if repeated at regular intervals. These gains dwarf the costs of tests. Cost estimates are difficult to produce given the rapid technological change, diagnostic accuracy 2. Testing of targeted segments of the population improvement, and the uncertainty about how soon and at what price new products will be available in low- and middle-income countries. • The PCR assay should be used to test for possible infections, in The PCR assay can be done either manually or through an automated order to facilitate contact tracing and targeted isolation efforts process. The manual process is cheaper but complex, prone to human for countries in early stages of epidemic (see the strategies error, and time consuming. Therefore, the more expensive automated followed by Hong Kong SAR, China; Korea; Singapore; and process, using a “plug-in” cartridge and relatively fool proof in settings Taiwan, China) and in the case of resurgent epidemics after where laboratory capacity is limited, is used more widely in PCR suppression (as China is currently doing). testing for different diseases in developing countries. One of the • Both tests should be used for health care and other essential “plug-in” cartridge options that is widely available for the staff to determine whether they are currently infectious (PCR COVID-19-specific assay, costs $198 for a cartridge and every cartridge assay) or already immune (antibody test). can perform 10 tests. Including amortization of a new PCR machine, • The antibody test should be used to decide who can be allowed laboratory equipment, consumables, transport, labor, and personal to return to work, giving priority to professions and services that protective equipment, the overall unit cost will be around $23. provide essential services (such as health care workers) and The antibody test is a rapid test which resembles existing rapid HIV require greater human contact (such as first responders). That is, test kits that can be administered by a health care worker collecting a workers who rank high on both the “essential” and “need for finger-prick. It does not require transport and analysis of the proximity” dimensions should be tested first. specimen to a qualified lab. Preliminary unit cost estimates for this test are between $US2.50 and $US5.30 per test for the antibody test, 3. Comprehensive and massive testing, approaching universal including the test kit itself, consumables, protective equipment, and levels labor in a developing country setting. Given the constraints on the availability and implementation of With the increase in demand if massive testing is the tests, comprehensive tests are unlikely to be feasible and are implemented—leading to increased economies of scale—we would best seen as a longer-term goal of targeted antibody tests. We anticipate that the costs will decline. Increased demand may also lead suggest starting with the targeted testing as in point 2 and to innovation in test technology that would ease complementary gradually expanding testing as capacity increases, along the human capital and laboratory capacity constraints for large-scale “essential” and “need for proximity” dimensions, moving toward testing. For example, options for self-administered (“at home”) tests comprehensive testing. kits, as well as door-to-door testing by minimally trained health community workers, are currently being evaluated for safety, What Are the Benefits and Costs of the Two Tests? accuracy, and acceptability; and regulatory approval for their use is The expansion of both types of testing, and incorporation in being secured. transmission control strategies, may yield significant returns. For The benefit-cost calculus also depends on the extent to which example, it is estimated that 25 percent to 50 percent of COVID-19 investments in testing today will be specific to COVID-19 and thus infections are asymptomatic. These individuals, once recovered, are have only limited benefits after the COVID-19 pandemic recedes or likely immune and do not need to socially distance (once there is no the extent to which they could more generally strengthen health live virus in their systems anymore), but will not know their status capacity and therefore have durable value. It is likely that a significant without an antibody test. The fear of infection is a persuasive proportion of public sector investments in testing (laboratory deterrent to economic activity, and even in the absence of official capacity, human capital, and so on) in low- and middle-income closures and restrictions there will likely be a high and possibly countries are investments in general health systems that will pay excessive degree of social distancing by individuals acting privately. returns in other aspects of diagnostic and perhaps curative health This fear would be alleviated in the recovered population if recovered care, apart from contributing to preparedness for future pandemics. individuals knew their status. In fact, the return to any individual tests For example, PCR machines are a “general-purpose” technology that depends on the extent to which recovered colleagues or customers can be used for the detection of many other bacteria or viruses and also know their status and return to the market. Widely available any well-equipped laboratory should have one, but they are still not low-cost testing can help solve this information-related market failure. very common in developing countries. 3 How Two Tests Can Help Contain COVID-19 and Revive the Economy Estimating Break-Even Recovery Thresholds for the Implementation of This discussion aims to help understand how extensive antibody the Antibody Test testing can be used to limit the economic impact of a shutdown by reducing the share of population asked to withdraw from activity. The discussion that follows estimates the “break-even” point of how Well-enforced lockdowns are now widespread in OECD countries, and large the number of recovered would have to be (which would lockdowns have also been ordered in a number of low- and determine the likely number of workers liberated from isolation) in middle-income countries. If a lock-down is not well enforced and a order to justify testing of an entire population, which in turn would large share of workers disregard such an order, then clearly the value enable “immunity certificates” to be issued for individuals to return to of widespread testing is diminished. Formally modeling these economic activity outside the home. considerations is beyond the scope of this Research Policy Brief. Table 1. Test, Test, Test: What, How, and Why Scale of the Test PCR Assay Antibody Test Representative sample of the population (stratified randomized sampling) Numbers: Depends on country size and To estimate the extent of current infection To assess the extent of immunity in the need for geographical precision at and hence determine the need for population or subgroups (by area, age, subnational level. nonpharmaceutical interventions (NPIs) gender, etc.) in order to determine the and pharmaceutical interventions (PIs). need for NPIs and PIs, and finetune social Sample sizes of recent demographic isolation or health care investment. health survey (DHS): Low net benefit because reasonable India: 600,000 households (to get estimates of incidence can be based on High net benefit because could significantly representative results at the state level) morbidity and mortality data, as well as reduce economic costs of suppression Bangladesh: 17,300 households information from the antibody test on a strategies and creating treatment capacity Nigeria: 40,427 households representative sample of the population. Philippines: 27,496 households Mali: 9,510 households. Frequency: Depends on initial level of immunity measured Targeted testing Numbers: Depends on estimated size of the Central to the test, trace, and isolate To assess and certify the immunity of population of targeted workers ranked strategy and hence possible substitute for categories of workers who can return to according to the dimensions of essential stringent suppression in the early stages work, starting with essential workers services and need for proximity with of a pandemic or when suppression has (health care, education) and progressively gradual expansion to other occupations. reduced infection levels. Must be to include others; hence, complements complemented by tracking and isolation stringent suppression. Philippines example: capacity. Population: 110 million Potentially high net benefits if it can allow Health care workers (2018): Also complements the antibody test of dilution of restrictions and revive critical Total: 187,250, including essential workers but would need to be segments of the economy. 90,308 nurses, 40,775 doctors, repeated regularly for noninfected 43,044 midwives, and 13,413 workers. medical technologists Education workers (2018): Potentially high net benefits if it can lead 880,000 public school teachers. to early phase-out of economically costly suppression measures for all or for Frequency: Depends on initial level of subgroups. immunity measured in representative sample. Individuals testing positive once on the antibody test can be excluded from subsequent testing. Comprehensive testing Numbers: Basically, the country’s Objectives are not clear. Objectives are not clear, except that it population, unless priority is placed on could be the limiting case of targeted some age groups or other demographics. Low net benefits. testing. In any case, it would have to be repeated for subgroups that have not Frequency: Depends on initial level of been infected. immunity measured in a representative sample. Unclear net benefits. Individuals testing positive once for antibody test can be excluded from subsequent testing. Note: NPIs = nonpharmaceutical interventions; PIs = pharmaceutical interventions. 4 Research & Policy Brief No.29 However, we should note that during pandemic outbreaks, much While the thresholds are of course sensitive to the unit costs of individual activity is curtailed even in the absence of a lockdown due tests and the benefit of bringing people back to work, in many to fear of infection. Wide-spread testing would help alleviate such fear countries the anticipated large scale of infection suggest that these among those who test positive and enable the resumption of some thresholds will easily be surpassed in the near future. In other words, share of economic activity. the rate of return to carrying out such a test is likely to be high. Define the working age population as, P = S + I + R, where S stands What Can the International Community Do? for susceptible, I for infected, and R for recovered (Kermack and McKendrick 1927). This exercise does not consider mortality. A precedent in medicine could be adapted for the current situation. Traditionally, public-private partnerships have been established to The ratio of those recovered is r = R/P. The unit cost of an antibody create new drugs or improve access to drugs where prices are high test is c. The average benefit of bringing one person back to work early because of intellectual property rights. For example, the Meningitis is b. Vaccine Project helped develop a new vaccine that has virtually eliminated the recurring outbreaks of meningitis that devasted 25 We begin by considering c and b to be the market costs and African countries for decades. The Project was coordinated by the benefits, respectively. Depending on the context, we could consider World Health Organization (WHO) and the global health organization other social costs and social benefits. The condition for the total PATH, with substantial funding from the Bill and Melinda Gates benefits of bringing workers back to work to cover the costs of a Foundation. Technology was transferred from the United States and population-wide test is given as: the Netherlands to the Serum Institute of India, which agreed to manufacture the vaccine at the low target price of 50 cents per dose. bR = cP. Similar initiatives or advance market commitments, i.e. promises The break-even level of r is: to purchase at a preannounced price, could help remedy market and policy failures in the market for tests. First, while the recent pandemic r* = c/b. has generated a burst of spontaneous innovation in tests, additional incentives may be needed to encourage innovation in tests tailored Therefore, the critical recovery ratio at which the benefit of for developing countries. Such innovations could include a simpler population testing outweighs the costs is simply the ratio of the unit PCR assay that relies less on complementary human and laboratory cost of an antibody test to the average benefit of bringing one person capacity. Second, while tests remain scarce, developing countries may back to work. find it difficult to outbid richer countries in the market for tests. Third, Based on our evidence, the cost, c, in a country like the Philippines some test-producing countries have imposed export restrictions that is about US$5. It seems likely that a vaccine will become available 12 could deprive developing countries of access to medical supplies, to 18 months after a test can be carried out, but suppression including tests (Mattoo and Ruta, 2020). measures could reduce the level of infections sufficiently to end the The international community could also catalyze collaboration to lockdown much earlier than that. expand the supply of these tests as well as complementary products and skills. The priority would be to encourage the production of the Let us assume the expected average benefit (b) of bringing a simplest versions of the PCR assay and antibody tests which meet person back to work early is about half their annual salary. For the sensitivity and specificity standards, and to make them available to Philippines, half the per capita income (b) is $1,742. Then r* in the developing countries. In parallel, an effort could be made to procure Philippines would be 0.0029. Since the working age population of the in bulk the necessary PCR machines and personal protective Philippines is about 70 million, that would mean the number of equipment for the staff handling specimen collection, and enhance recovered would have to be about 200,000. For perspective, the the capacity to process them, as well as to organize the testing in Imperial College COVID-19 Response Team estimates for the representative samples of the population. Private companies could be Philippines imply that after 250 days, nearly 5 million people would directly contracted to expand production of test kits and equipment have recovered under a suppression scenario triggered at 0.2 deaths to fulfill the needs of developing countries. Medical colleges across per 100,000 (Walker et al. 2020). the world could be contracted to provide intensive courses in testing The logic of this argument is simply the following: until for health personnel and other suitably qualified people—including randomized testing suggests we have reached the threshold r*, it those who cannot pursue their regular professions in current would be better to transfer the money that would have been spent on circumstances. a working population-wide antibody test—US$ 350 million ($US5 per We recognize that tests are not a silver bullet and must be test times 70 million workers), in the case of the Philippines—to implemented as part of a battery of public health interventions. Tests affected workers because the cost of carrying out such a test would require a strengthening of the capacity to use them and compete for lead to lower aggregate earnings for the people brought back to work. resources with the capacity to treat the victims of the disease. But if But for any r > r*, the test would yield a positive rate of return. If, as it is feasible to build the necessary capacity, then tests can help at noted, the social benefit of being at work was higher than the market relatively low cost to reduce the number of victims, not just of the income—for example, because working helped maintain skills—then disease but also of the economic immiseration associated with other the threshold for testing could well be lower. stringent suppression strategies. References Eichenbaum, Martin S., Sergio Rebelo, and Mathias Trabandt. 2020. "The Macroeconomics of Walker, Patrick G. T., et al. on behalf of the Imperial College COVID-19 Response Team. 2020. Epidemics." 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